In addition to the refund processing delays described below, the IRS is also experiencing delays in processing payments that has led to clients receiving erroneous balance due statements. It seems that IRS is quickly cashing payment checks, but it can take several weeks before IRS credits the payment to the taxpayer’s account.
We are continuing to see extreme delays this year (often several months) from IRS in processing taxpayer refunds. It seems that IRS has had difficulties processing returns that include the Recovery Rebate Credit for missed 2020 stimulus payments. The problem is compounded by the IRS phone delays and hang-ups, so it is very difficult for taxpayers to obtain any updates from IRS.
Our tax software allows us to verify that our client’s returns have been sent to IRS and accepted for processing. However, we have no way to check on the status of a return after that. Unfortunately, the only option is to check directly with the IRS via the web site at https://www.irs.gov/refunds, but that is often not very informative.
The good news is that the media and Congress are now paying more attention to this issue, so it is possible that IRS will start to speed things up. IRS did have quite a backlog of mail from the COVID shutdown, so things should improve once it has worked through that.